Facebook is the clear global leader in social mobile marketing with 2 billion monthly active users, with the company also comprising
600 million users on
Instagram, 1.2 billion on
WhatsApp and more than
1 billion on Messenger.
This is an excellent example of a business enjoying network effects with revenue growth at 50%pa leading to 90% incremental margins. Facebook’s potential move into television-quality shows will keep an upward trajectory on the cost of high-quality programming. Advertisers chasing a higher return on their expenditure are increasingly attracted to specific users’ interest groups produced from Facebook’s highly valuable algorithms, and this is likely to see increasing pressure on many free-to-air television and pay TV businesses.